The venerable price tag and its computer-age competitor have become the focus of a raging battle between consumer groups and the area's largest supermarket chain.
At issue is how a box or bottle needs to be labeled so that a shopper knows its price. Giant Food, Inc., which rings up about one-third of the supermarket sales in the area, maintains it can save money by posting prices only on the shelves, rather than on individual products, and using checkout equipment that scans the computerized uniform product code that is printed on most products.
Consumer groups argue, though, that unless packages are individually marked, it is difficult for consumers to do comparison shopping.
Giant already has eliminated individual price tags in its new no-frills store in Clinton, Md. The chain plans to use the same system at three more no-frills stores that are scheduled to open in Maryland in the next few weeks. Other Washington area supermarkets -- including the Grand Union "Basic" stores -- still are marking individual items, but officials say they are watching the Giant experience closely.
Giant officials, led by president Israel Cohen, yesterday tried to sell representatives of a dozen consumer groups on the merits of shelf-pricing over item-pricing. During the two-hour, closed-door meeting, the company said that shelf-pricing is a less expensive way to provide information to shoppers. Officials implied, but did not promise, that savings from the new system might lower shoppers' food bills.
"We hope to moderate price increases with this system . . . but we are not sure if it will mean lower prices or less price increases," said David Rutsten, the company's vice president and general council, in an interview after the meeting. "We will know more after six months."
Consumer group representatives left the meeting vowing to fight the Giant move, which they fear could spread throughout the supermarket industry. "It is unfortunate that Giant is making the mistake of misreading consumers on such a fundamental issue," said Ellen Haas, director of the consumer section of the Community Nutrition Institute.
Haas and some of the other consumer activists were part of a coalition that opposed eliminating individual price tags in the mid-1970s, when the universal price code was introduced. At the time, they said, the supermarket industry generally agreed to keep individual price tags. "Now Giant is testing to see if it can go back on the industry policy," Haas said.
CNI is one member of the coalition of consumer and labor groups that has formed to seek legislation to require stores to put individual price tags on retail food products. Called the "Right to Information" committee, the group said consumers today need more information, not less, when they shop for groceries and when they make buying decisions at home.
"One of the biggest benefits of the item price is that when you take it home and compare it to what's in the pantry, you can see what has happened to the price," said Charlotte Newton, president of the Virginia Citizens Consumer Council. "For instance, you can see that the new bottle of Log Cabin syrup is $1.79 and the old bottle was $1.60. And you can decide then if you want to buy another brand, maybe the house brand, the next time you shop."
Newton and Haas also said they were skeptical about the amount of savings that might be passed on to consumers. "They said there is a possibility of this bringing savings, but there is no way to monitor that," Haas said.
Store officials said the Clinton store is particularly suited for shelf-pricing because of its no-frills style of operation. Cases of merchandise are set out on shelves and containers of soft drinks are rolled into aisles. In addition, the number of brands and sizes of merchandise has been reduced, from the 12,000 items of most regular stores to about 5,000.
All 123 Giant supermarkets in the Washington metropolitan area are equipped with computerized checkouts, but so far the chain has eliminated item-pricing only at the no-frills outlet.
The issue of the shopper's right to have individual items priced is a sensitive one for Giant. Company officials refused to allow a reporter into yesterday's meeting. But some persons present quoted Cohen as saying that Giant must find ways to reduce its cost because of the recent decine in company profits.
"He said Giant is at a crossroads . . . and must make improvements [in cutting costs] or raise prices," said Ann Brown, chairman of the Consumer Affairs Committee of Americans for Democratic Action. Brown said that Cohen played down the importance of item pricing for consumers.
"Cohen said he had never seen a shopper look at a price on an item," she said.
Giant did get some support at the meeting for its plan, however. The six women who were selected by the company to serve as volunteer members of its Corporate Consumer Board generally approved of the Giant idea.
"They implied that we were on Giant's payroll," said Jane Schroeder, a consumer board member from Baltimore. "And some of them were very condescending . . . like we were just housewives," she said.
Schroeder said that she doesn't care if Giant removes all of the prices from its products. "I can switch stores if I don't like it," she said.
Besides Brown's, Haas' and Newton's groups, the coalition opposing Giant includes the Consumer Federation of America, the Food and Allied Services Trades Council of Metropolitan Washington, the National Consumers League, the United Food & Commercial Workers Local 400, the Food Research and Action Center and the Maryland Citizens Consumers Council.
Odonna Matthews, who serves as Giant's consumer affairs adviser and is president of the Maryland group, has turned the issue over to another officer to avoid a conflict-of-interest, she said.